Freddie Mac (OTCMKTS:FMCC) versus Zillow Group (NASDAQ:ZG) Head to Head Comparison

Freddie Mac (OTCMKTS:FMCC) and Zillow Group (NASDAQ:ZG) are both finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, valuation, earnings, risk, dividends, analyst recommendations and profitability.

Earnings & Valuation

This table compares Freddie Mac and Zillow Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Freddie Mac	$122.05 billion	0.05	$11.86 billion	($0.03)	-315.00
Zillow Group	$2.24 billion	8.83	-$112.00 million	($0.26)	-313.38

Freddie Mac has higher revenue and earnings than Zillow Group. Freddie Mac is trading at a lower price-to-earnings ratio than Zillow Group, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

20.3% of Zillow Group shares are owned by institutional investors. 0.1% of Freddie Mac shares are owned by company insiders. Comparatively, 17.1% of Zillow Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations for Freddie Mac and Zillow Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Freddie Mac	1	0	0	0	1.00
Zillow Group	1	11	13	0	2.48

Freddie Mac currently has a consensus target price of $4.50, suggesting a potential downside of 52.38%. Zillow Group has a consensus target price of $85.62, suggesting a potential upside of 5.08%. Given Zillow Group’s stronger consensus rating and higher probable upside, analysts clearly believe Zillow Group is more favorable than Freddie Mac.

Profitability

This table compares Freddie Mac and Zillow Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Freddie Mac	9.04%	-44.33%	0.34%
Zillow Group	-2.60%	-1.26%	-1.04%

Volatility and Risk

Freddie Mac has a beta of 2.06, indicating that its share price is 106% more volatile than the S&P 500. Comparatively, Zillow Group has a beta of 2.07, indicating that its share price is 107% more volatile than the S&P 500.

Summary

Zillow Group beats Freddie Mac on 9 of the 14 factors compared between the two stocks.

About Freddie Mac

Federal Home Loan Mortgage Corporation operates in the secondary mortgage market in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment purchases, securitizes, and guarantees single-family loans; and manages single-family mortgage credit and market risk, as well as manages mortgage-related investments portfolio, single-family securitization activities, and treasury functions. This segment serves mortgage banking companies, commercial banks, regional banks, community banks, credit unions, housing finance agencies, savings institutions, and non-depository financial institutions. The Multifamily segment engages in the purchase, securitization, and guarantee of multifamily loans; issuance of multifamily K certificates; manages multifamily mortgage credit and market risk; and invests in multifamily loans and mortgage-related securities. It serves banks and other financial institutions, insurance companies, money managers, hedge funds, pension funds, state and local governments, and broker dealers. Federal Home Loan Mortgage Corporation incorporated in 1970 and is headquartered in McLean, Virginia.

About Zillow Group

Zillow Group, Inc. operates real estate brands in mobile applications and Websites in the United States. The company offers premier agent and rentals marketplaces, new construction marketplaces, advertising, display advertising, and business technology solutions, as well as dotloop and floor plans. It also provides mortgage originations and the sale of mortgages, and advertising to mortgage lenders and other mortgage professionals; and title and escrow services. In addition, the company's brand portfolio includes Zillow Premier Agent, Zillow Home Loans, Zillow Rentals, Trulia, StreetEasy, HotPads, and Out East; and a suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce, and Follow Up Boss. Zillow Group, Inc. was incorporated in 2004 and is headquartered in Seattle, Washington.